The multimillion-dollar stock issue plaguing The Warehouse
Saturday, 20 December 2025
The Warehouse Group is said to be sitting on $80 million worth of stock it has struggled to sell for years, bought during Nick Grayston’s tenure as CEO.
The stock ‒ believed to be a mix of higher end and more basic goods ‒ is said to be causing issues, sitting stagnant and taking up needed space in its South Auckland warehouse that could otherwise be filled with new and incoming stock.
The owner of The Warehouse, Warehouse Stationery and Noel Leeming has struggled with declining sales, profitability and a dwindling customer base in recent years as its products fell out of fashion and failed to woo shoppers.
A source told The Post the company is grappling with a “multitude of things”, including mass buying of what turned out to be unwanted product, to the tune of tens of millions of dollars worth of articles sitting in The Warehouse’s distribution centre that has been unable to be sold even years later.
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A source close to the company claims The Warehouse set up its Bargain Shed store in Auckland’s Mt Eden earlier this month to specifically sell this dated stock ‒ and to get rid of it cheap. The opening coincided with the opening of Ikea’s Auckland store, offering new homeware and furniture deals each week.
“They've got stock they can't move. They're trying to move it, but much of it is slow moving, or the wrong stock. They went down this path with the idea of being Sears, the high end department store of New Zealand, that trend didn't work ‒ and now they've got so much stock their Auckland distribution centre is overflowing,” The Post was told.
“It's not stock that will move in a hurry … the past buyers bought the wrong stock. They were given a bit too much freedom.”
Asked about quantities and how much that stock was worth, the source replied: “I've been given a figure of $80 million.”
The old stock is said to be impacting current operations, because it has restricted the amount of space available to house new and incoming stock.
However, The Warehouse neither confirmed nor denied the stock glut was causing problems when asked by The Post.
New chief executive Mark Stirton said the Balmoral Road Bargain Shed was a pop-up store that offered a mix of old and newer stock.
“The site in Mt Eden is owned by the group and is one of several cost-effective initiatives we are testing and learning from to enhance our offer for customers during our peak retail trading season,” Stirton said.
He said the company had inventory of $477m, of which 23.1% was aged ‒ what it deemed more than six months old ‒ compared with 19.9% of aged stock in the year prior.
That aged stock was primarily made up of “continuity products” – and Stirton confirmed that improving “inventory management” was “a key focus” of the group’s turnaround.
The Post was told The Warehouse began to lose its way under the leadership of former permanent chief executive Nick Grayston, and part of the group’s cost-cutting measures come as an attempt to rectify problems stemming back to his time in charge.
Grayston, who has been contacted and did not respond to requests for comment, joined the retail group in late 2015, and abruptly finished up with the company in May 2024. At the time the company’s board shared few details, except saying that he had left immediately and a 'change in direction is necessary for the company”.
Grayston previously worked for US department store Sears.
The Warehouse has been open about how it “lost focus” and was “too ambitious” with setting previous strategies. It has spent the past year embarking on what it calls a turnaround to reset its product offering, strategy, pricing and organisational restructure to cut costs and win back market share.
This has included partnering with India-based IT and digital conglomerate Tata Consultancy Services to outsource some head office jobs. The offshore outsourcing of jobs through Tata is said to impact a wide range of jobs across its finance, IT, property, shipping and legal departments. Jobs cuts here are expected to be replaced through Tata in India.
The retailer has not confirmed this and would not share any details about its proposals. “As we are so early in this process, we are not in a position to share any specifics around working practices,” a spokesperson for the company said.